Corruption erodes trust in public institutions and in democracy, it undermines our internal market, it hampers foreign investment, it costs tax payers millions, and in many cases it helps organised crime groups do their dirty work.

Corruption is estimated to costs EU Member States no less than 120 billion Euros each year.

That is why the Commission adopted today the first EU Anti-Corruption Report. The Report gives a frank assessment of how each Member State tackles corruption, how existing laws and policies work in practice, and it suggests how each Member State can step up the work against corruption.

The Report shows that the level of corruption varies from one Member State to another. But it also shows that corruption affects all EU Member States. One thing is very clear: there is no "corruption-free" zone in Europe.

European citizens are fully aware, and concerned, about this. The results of two Eurobarometer surveys, also published today, show that a vast majority (76%) of Europeans think that corruption is widespread in their own country. More than half of Europeans (56%) think the level of corruption in their country has increased over the past three years.

One in twelve Europeans has experienced or witnessed corruption in the last twelve months, and four out of ten European companies consider corruption to be an obstacle for doing business within the EU.

This is all the more worrying in times of economic and financial crisis. In order to pull Europe from the brink of the crisis, we need to attack corruption effectively by pulling efforts from all sides.The Report will hopefully provide everyone - politicians, the public, media and practitioners – with a useful tool for taking national corruption policy forward.

A number of Member States have already put stronger focus on in recent years. New legislation has been adopted, new institutions have been set up and national anti-corruption strategies adopted in many member States. The Reports takes stock of these developments, the progress which has been made, and points to a number of good practices that others can learn from.

At the same time, the Reports shows that the results are not yet sufficient. We are simply not doing enough. That is true for all Member States. Existing laws and policies are not enforced enough, and a firm political commitment to root out corruption still seems to be missing.

The Report therefore calls for improvements in a number of different areas. In some Member States, vulnerability to corruption in public procurement processes is the main problem. In others, political party financing is not transparent enough. Widespread corruption at the level of local authorities is another example, or that many healthcare patients have to pay under the table to receive proper medical care.

For each of these areas, the Report suggests solutions, based on a careful assessment of each Member State. They include:

better accountability and integrity standards;

control mechanisms in public authorities;

dealing with conflicts of interests by officials;

how to address corruption at local level and in state-owned companies

the effectiveness of courts and police, and protection mechanisms for whistleblowers;

limiting risks of bribery in foreign countries, and making lobbying more transparent;

And - developing innovative e-tools to enhance transparency.

The Report also takes a close look at corruption in public procurement. One fifth of the EU’s GDP is spent every year in public procurement of goods and services, and this is essential to our economies. But it is also an area which is vulnerable to corruption: studies suggest that up to a quarter of the value of public contracts in EU Member States may be lost to corrupt practices.

According to the Eurobarometer survey we publish today, one third of companies that participated in public tenders say corruption prevented them winning a contract.

The Report therefore suggests Member States to make stronger efforts in this area, by strengthening controls and getting more dissuasive sanctions in place, as well as enhancing transparency.

Conclusion

This Report is a first step. It is the first time we have a complete overview of the situation in all Member States, and a set of suggestions for how to move forward.

We will now engage in a dialogue with Member States, the European Parliament, National Parliaments and others - and workwith Member States to follow up on our suggestions.

In two years' time, the next EU Anti-Corruption Report will take stock of how far we have moved forward together.

Needless to say, it will take more than one report to root out corruption. But as Europe is finding its way out of the economic crisis, we cannot afford to drag our feet.

We hope that this will start a political process and will spur the political will and the necessary commitment at all levels to address corruption more effectively across Europe. The price of not acting is simply too high.